business strategy | November 26, 2013

Why Regular People Should Invest in Start-Ups: Jessica Jackley's WSJ Op-Ed

Jessica Jackley knows a lot about start-ups. In a recent Wall Street Journal editorial, she writes about why she is in favor of new legislation that allows entrepreneurs raising startup capital (less than $1 million) to invite anyone to invest, including the general public. It's more inclusive, for one, she says—there's something inherently "wrong" about excluding regular people from investment opportunities. As the co-founder of Kiva, the world's most successful microlending site, Jackley saw the company grow from a social entrepreneurship experiment to over $500 million in loans to entrepreneurs across 206 countries. That success is based on a simple concept: investing in entrepreneurs.

Restricting anyone’s ability to invest does mean protecting certain people from losing money. But it also cuts most of the population off from the benefits. This is not the answer. We must provide education, information and the opportunity to learn by doing, for everyone.

And, Jackley shares her beliefs that unaccredited investors may be more "invested" (no pun intended) in the business because of their smaller resources and bigger potential for major loss or gain.

I’d bet that as unaccredited and accredited folks interact a bit more, at first just as co-investors in a startup but eventually perhaps as advisors or board members for those companies, we will learn that the best contributors to these ventures are those with more to lose. When everyone has the same information and the same opportunities to contribute, people who have never been able to play in this game before will have a new and unique perspective that might—God forbid—teach the 1% (or, there I go again, the 3%) a thing or two. Perhaps we’ll see that those without a huge cushion of financial resources to fall back on might make even more prudent, more careful, more efficient, more meaningful choices with limited resources than those for whom a few hundred or even a few thousand dollars is a drop in the bucket.

In her talks, Jackley presents powerful new business lessons, reframing best practices in atypical, thought-provoking ways. To book Jessica Jackley as a speaker for your event, contact The Lavin Agency.

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education | November 25, 2013